22.5 C
Scarborough

Consumer carbon tax dropped, Canadians to save about 17 cents per litre on gas

Must read

Canadians will notice a drop in prices at the gas pumps starting Tuesday after the consumer carbon tax was axed.

“Eliminating the consumer carbon tax will save about 17 cents a litre,” University of Ottawa law and economics professor Stewart Elgie told on Tuesday.

Elgie, who specializes in environmental and natural resources law and policy, says carbon pricing has led to a roughly seven per cent drop in Canada’s greenhouse gas emissions over the past four years.“Canada’s emissions are finally coming down after decades of going up,” Elgie said. “It shows that our climate policies are starting to work.”

One of Liberal Leader Mark Carney’s first actions as prime minister was to eliminate the largely unpopular consumer carbon price, which charged Canadians for their greenhouse gas emissions. The change, which went into effect on Tuesday, does not affect the carbon tax on industrial emissions.

“The industry price achieves about three times more of the reductions, because industry does more emitting, especially oil,” Elgie explained. “So it’s Canada’s most important climate law.”

Canada’s carbon levy had previously been set at $80 per tonne, which has increased annually since the charge first came into effect in 2019. Most recently that worked out to 17.6 cents per litre of gasoline and roughly $4 per gigajoule of natural gas for home heating. Although the drop is being quickly reflected at Canada’s gasoline pumps, it could be offset by increases in crude prices or refinery downtime.

While Carney has promised to keep industrial carbon pricing, Conservative Leader Pierre Poilievre has vowed to drop it if he becomes prime minister following the April 28 election. Elgie says such a move would be bad for both the environment and the economy.

“That would cause a big emissions increase, roughly equivalent to doubling the number of cars on the road,” Elgie cautioned. “Most industry CEOs support the carbon price because it’s the lowest cost way to reduce emissions and drive innovation.”

Carbon rebate payments will also be dropped along with consumer carbon pricing, with the last cheques and payments going out to Canadians starting April 22.

“The average household got about $1,000 to $2,000 depending where you live, so for most people it will be roughly a wash in terms of the net cost,” Elgie said. “With no consumer carbon revenues, there won’t be a consumer carbon rebate.” (CTV)

 

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest article